PAYE will be payable by direct debit to HMRC

HMRC has confirmed plans to modernise its direct debit payment system for employer PAYE so a recurring direct debit can be set up for the first time.

Currently employers can only set up a direct debit to collect a single payment, but not a recurring direct debit.

When can employers arrange direct debit to pay the PAYE liabilities?

As part of its payment modernisation programme, HMRC is going to offer a recurring direct debit to employers. This is part of a wider project to create a consistent set of payment methods for all taxpayers across the tax authority, rather than the current limited service, which varies depending on the type of tax payable.

The service will be available from mid-September this year, HMRC said.

How can employers setup the direct debit for PAYE?

Once available, there will be a change to the business tax account (BTA) and the employers’ liabilities and payments screens. There will be a new link for ‘set up a direct debit’. This will allow client companies to set up a direct debit instruction once, authorising HMRC to collect directly from their bank account based on their return submissions.

The link will change to “manage your direct debit” if an employer has setup a direct debit, at which point the employer can view, modify, or cancel the direct debit online.

Payments which will be covered by direct debit will show within employers’ liabilities and payment screens for both employers and agents.

This service is not available for agents and only employers will be able to create, view, amend and cancel a direct debit.

Employer PAYE liabilities and payments viewer update

HMRC also confirmed that it has been extending employer PAYE for the agent online service on a rolling basis and that the expansion is ‘progressing well’. This service allows agents to see employer liabilities and payments records held by HMRC.

All previous restrictions will be removed by the end of July and in future all agents will be able to access the service. This will include those with the assistant as well as administrative roles.